Correlation Between Amkor Technology and Highway Holdings
Can any of the company-specific risk be diversified away by investing in both Amkor Technology and Highway Holdings at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Amkor Technology and Highway Holdings into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amkor Technology and Highway Holdings Limited, you can compare the effects of market volatilities on Amkor Technology and Highway Holdings and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Amkor Technology with a short position of Highway Holdings. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and Highway Holdings.
Diversification Opportunities for Amkor Technology and Highway Holdings
-0.28 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amkor and Highway is -0.28. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and Highway Holdings Limited in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Highway Holdings and Amkor Technology is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Amkor Technology are associated (or correlated) with Highway Holdings. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Highway Holdings has no effect on the direction of Amkor Technology i.e., Amkor Technology and Highway Holdings go up and down completely randomly.
Pair Corralation between Amkor Technology and Highway Holdings
Given the investment horizon of 90 days Amkor Technology is expected to under-perform the Highway Holdings. In addition to that, Amkor Technology is 1.27 times more volatile than Highway Holdings Limited. It trades about -0.17 of its total potential returns per unit of risk. Highway Holdings Limited is currently generating about -0.15 per unit of volatility. If you would invest 207.00 in Highway Holdings Limited on August 25, 2024 and sell it today you would lose (14.00) from holding Highway Holdings Limited or give up 6.76% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 95.65% |
| Values | Daily Returns |
Amkor Technology vs. Highway Holdings Limited
Performance |
| Timeline |
| Amkor Technology |
| Highway Holdings |
Amkor Technology and Highway Holdings Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amkor Technology and Highway Holdings
The main advantage of trading using opposite Amkor Technology and Highway Holdings positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology position performs unexpectedly, Highway Holdings can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Highway Holdings will offset losses from the drop in Highway Holdings' long position.| Amkor Technology vs. Teradyne | Amkor Technology vs. Ichor Holdings | Amkor Technology vs. Amtech Systems | Amkor Technology vs. Veeco Instruments |
| Highway Holdings vs. CompoSecure | Highway Holdings vs. Dave Warrants | Highway Holdings vs. Evolv Technologies Holdings | Highway Holdings vs. Aquagold International |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Idea Breakdown module to analyze constituents of all Macroaxis ideas. Macroaxis investment ideas are predefined, sector-focused investing themes.
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